Business, 07.03.2020 01:20 tgeorge95

Allocate transaction price.

The Appliance Store is an experienced home appliance dealer. Appliance Store also offers a number of services together with the home appliances that it sells. Assume that Appliance Store sells dishwashers on a standalone basis. Appliance Store also sells installation services and maintenance services for dishwashers. However, Appliance Store does not offer installation or maintenance services to customers who buy dishwashers from other vendors. Pricing for dishwashers is as follows.

Dishwasher only

$ 950

Dishwasher with Installation service

1,050

Dishwasher with maintenance services

1,150

Dishwasher with installation and maintenance services

1,200

In each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $200. Additionally, the incremental amount charged by Appliance Store for installation approximates the amount charged by independent third parties. Dishwashers are sold subject to a general right of return. If a customer purchases a dishwashers with installation and/or maintenance services, in the event Appliance Store does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $800.

Instructions

(a) Assume that a customer purchases a dishwasher with both installation and maintenance services for $1,200. Based on its experience, Appliance Store believes that it is probable that the installation of the equipment will be performed satisfactorily to the customer. Assume that the maintenance services are priced separately. Identify the separate performance obligations related to the Appliance Store revenue arrangement.

(b) Indicate the amount of revenue that should be allocated to the dishwasher the installation, and to the maintenance contract.

(c) Prepare the necessary journal entry for the Appliance Store.

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 01:30

At the end of the week, carla receives her paycheck and goes directly to the bank after work to make a deposit into her savings account. the bank keeps the required reserve and then loans out the remaining balance to a qualified borrower named malik as a portion of his small business loan. malik uses the loan to buy a tractor for his construction business and makes small monthly payments to the bank to payback the principal balance plus interest on the loan. the bank profits from a portion of the interest payment received and also passes some of the interest back to carla in the form of an interest payment to her savings account. in this example, the bank is acting

Answers: 1

Answer

Business, 22.06.2019 06:40

At april 1, 2019, the food and drug administration is in the process of investigating allegations of false marketing claims by hulkly muscle supplements. the fda has not yet proposed a penalty assessment. hulkly’s fiscal year ends on december 31, 2018. the company’s financial statements are issued in april 2019. required: for each of the following scenarios, determine the appropriate way to report the situation. 1. management feels an assessment is reasonably possible, and if an assessment is made an unfavorable settlement of $13 million is reasonably possible. 2. management feels an assessment is reasonably possible, and if an assessment is made an unfavorable settlement of $13 million is probable. 3. management feels an assessment is probable, and if an assessment is made an unfavorable settlement of $13 million is reasonably possible. 4. management feels an assessment is probable, and if an assessment is made an unfavorable settlement of $13 million is probable.

Answers: 1

Answer

Business, 22.06.2019 11:50

The following are the current month's balances for abc financial services, inc. before preparing the trial balance. accounts payable $ 10,000 revenue 6,000 cash 3,000 expenses 17,500 furniture 10,000 accounts receivable 14,000 common stock ? notes payable 6,500 what amount should be shown for common stock on the trial balance? a. $48.000b. $12.500c. $27.000d. $28.000

Answers: 3

Answer

Business, 22.06.2019 14:10

When a shortage or a surplus arises in the loanable funds market a. the supply of loanable funds changes to return the economy to its original real interest rate b. the nominal interest rate is pulled to the new equilibrium level c. the demand for loanable funds changes to return the economy to its original real interest rate d. the real interest rate is pulled to the new equilibrium level

Answers: 3

Answer

You know the right answer?

Allocate transaction price.

The Appliance Store is an experienced home appliance dealer....

Questions